Wall Street rebounds strongly as attention turns to third quarter earnigs

  • Technology sector gains more than 3% on Friday.
  • Both the DJIA and the S&P 500 lose over 4% for the week.
  • Financials continue to underperform.

Following a positive start to the day, major equity indexes in the U.S. staged an impressive recovery on Friday to close the week on a strong note. As investors are getting ready for the third quarter earnings figures, bargain shopping provided a strong boost ahead of the weekend.

Commenting on today's market action, "Generally what we were seeing is more momentum and technology names selling off. Now buyers are coming back to say some of these are babies that were thrown out with the bath water. Now we've had the pullback, valuations look attractive," said Kane, although without a U.S.-China trade deal, "some of the sources of volatility are not going to go quickly," Laura Kane, head of Americas thematic investing at UBS Global Wealth Management, told Reuters.

The S&P 500 Technology Index added 3.15% on the day, and the S&P 500 Communications Services Index rose 2.08% to lead the gains. On the other hand, the rate-sensitive S&P 500 Financials Index, which added 0.1%, underperformed as this week's macroeconomic data releases from the U.S. failed to change the expectations for another Fed rate hike in December. Similarly, the S&P 500 Energy Index only added 0.3% as the WTI lost $4 this week amid concerns over global demand outlook.

The Dow Jones Industrial Average closed 275.74 points, or 1.1% higher at 25,328.57. The S&P 500 rose 38.11 points, or 1.4%, to 2,766.57 and the Nasdaq Composite gained 168.69 points, or 2.3%, to 7,497.75. Despite today's upsurge, these three major indexes lost 4.2%, 4.22%, and 3.7%, respectively.

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